Hey Thorsten! Congratulations on the acquisition! It is especially pleasant news given that one of the aims of the Operator Set Strategy is to “take into account ecosystem participation and stewardship, and support smaller organizations which vitally contribute to validating and staking;”. CMF’s Ethereum community impact has been exemplary, as has its participation in the Lido community (including in matters of governance input and increasing protocol and overall Ethereum staking resilience via client diversification), so it’s nice to see these efforts, bolstered by participation in the Lido curated set, be rewarded.
This presents an interesting development from the perspective of curated operators, as CMF are participants in both the Curated as well as Simple-DVT modules. As there is no policy that guides these kinds of things it’s probably helpful to do a quick historical review of similar events and have a first principles discussion about what the best way to proceed may be.
Given that there are no legal agreements that control or govern NO usage of Lido on Ethereum and participation in the curated set, a DAO vote to add an NO to the curated set might roughly be understood as “this team, running nodes this way, has been allowlisted to do so”. While teams do change over time, including in how they run infra, it’s usually through a gradual process that involves both community interactions (discussions with node operators and SMEs on how to tune and diversify infra) as well as outreach (e.g. via forum discussions). Thus, the idea of “selling a seat” (or outsourcing infra operation to a whitelabel provider, contra to the Operator Set Strategy) seems to violate this principle, but something like a full buyout (infra+people) potentially doesn’t.
Historically, these are the changes that have happened in the Curated Set:
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Certus One was acquired (infra+team) by Jump Crypto Quant Shop Jump Trading Buys Blockchain Firm Certus One - Bloomberg. Post merger, the operator did not add additional keys and eventually exited the active set.
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Blockdaemon acquired (infra+team) Anyblock Analytics at a time when both Node Operators had already joined the Curated Set. As a result, the two operators were “merged” in the node operator registry by essentially pausing deposits in Anyblock Analytics (so new validators would only be going to BD infra) and then prioritizing exits and eventually deprecating and deactivating the latter operator registry entry.
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Prysmatic Labs (infra+team) were acquired by Offchain labs. Prysmatic Labs are a bit of a special case in that they are a client team, but even so there was no change in the people running the validator infrastructure using Lido on Ethereum, nor how the infrastructure was being run.
It would probably have been better to have an explicit discussion (and perhaps vote) in each of these cases, but I suggest the following from a first principles perspective:
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it could be assessed whether as a result of the business deal there are material changes to validators operations (different people / different infra)
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it could be assessed whether as a result of the business deal there are material changes to the organizational structure and “meta-properties” of the node operator (eg impact on geographic and jurisdictional dispersion of the operator set)
While Thorsten’s post above does answer some of these points, I think it would be beneficial for the community to have a little bit more detail and for a formal post from the acquiring team at Galaxy Digital as well.
In the cases of substantial change in either or both of the above, the DAO may want to consider whether to:
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ask the LNOSG (or anyone else) to conduct an appraisal similar to that during onboarding rounds and offer an opinion, after which it could vote on whether the operator in its new form should remain in the curated set (or a secondary option should be explored), and/or
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directly move to pause (i.e. disable the allocation of new validators) or stop (exit and deactivate) the operator.
My personal opinion here is that given that both of these entities (CryptoManufaktur and Galaxy Digital) are very well known, I don’t see a reason for concern (i.e. to pause or stop the operator), especially given that the team will stay on and continue to run the infrastructure. As the number of node operators utilizing the protocol grows, it’s probably good to apply a bit more rigor and a consistent framework to these cases, so I think there should be a discussion on the matter, and also suggest that at a snapshot vote can be held to clarify whether the Operator should remain and operate as-is (which seems to make sense given the nature of the acquisition and precedent), or other options should be identified, discussed, and considered.